The Supreme Court has rejected General Motors Company’s (GM) that it is not liable for some of the personal injury and wrongful death claims over its faulty ignition switch. GM had previously argued that it was not liable for lawsuits filed before its Chapter 11 bankruptcy in 2009. Last year, the Second Circuit Court of Appeals rejected this notion. The Supreme Court justices have upheld the prior ruling, potentially allowing $5 to $10 billion worth of claims against GM to move forward. There are more than 1,000 outstanding ignition switch lawsuits against GM, and it has already paid more than $2 billion in penalties and settlements.
Why did a federal appeals court and the Supreme Court reject GM’s attempt shed itself of liability? GM had argued its reorganization through Chapter 11 bankruptcy shielded it from prior injury and wrongful death claims. In its ruling last year, a federal appeals court argued that GM is liable because it hid the ignition switch defect from vehicle owners before filing bankruptcy.
How Can GM Ignition Switch Lawsuits Help Victims?
This turn of events is good news for victims of GM’s ignition switch victims and families who filed their suits prior to the reorganization. GM’s ignition switch defect is linked to 124 deaths and 275 injuries. The defect would cause the ignition switch to move into the off position while the vehicle was in use. As a result, power would be cut to the air bags, brakes and engine while people were driving.
Victims of the ignition switch who survived suffered catastrophic injuries, such as burns, amputations and spinal cord injuries. Lawsuits against GM can help victims or their family members pay for the extensive economic and noneconomic costs caused by the defect.